In what's sure to be the "Killer app" for iPhone's release, Apple's App store showcases a free download from Apple titled, "Remote".  The marketing speak says:

Be a mobile DJ. With Remote, you can control music on you Computer or Apple TV from your iPod touch or iPhone.

Play, pause, skip, shuffle. See your songs, playlists, and album art, on your iPod touch or iPhone as if you were in front of your computer.

Remote works with your Wi-Fi network, so you control playback from anywhere in and around your home.

 

Features

- Control the music on iTunes or Apple TV

- See the album artwork on your Remote

- Search the whole iTunes library

- Control your AirTunes speakers

Looks like there may be a function for multi-zone music playback with this feature- something I'll have to investigate.  More screens below:

Update: I've successfully tested the app with both an Apple TV and a massive iTunes library and report that the performance is snappy overall. When the Apple TV was powered off, a notification appeared on the iPhone which was also a nice touch.  Apps like this have existed for years for Windows Mobile-based devices, and most recently percolating to a solution for Windows Sideshow so that's now what's new- what's new is that this is the first time Apple has intimated the iPhone as a control device vs. consumption of media.

As for the Sonos comparison, it's readily apparent that Remote (and iTunes in general) is missing a critical feature IMO - synchronized audio playback.  Sonos' wireless mesh network delivers sync'd playback so flawlessly that I'm hard pressed to think of another CE-device in my stable that has worked so well.  This is a key feature for multi-room audio as we regularly fill the house and yard with music when cleaning, entertaining, celebrating the holidays.  I will say the iPhone fits in my pocket a sight better than the Sonos controller - a complete comparison to come in the future.